This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

4 Reasons Not to Buy Stocks in 2013

Since then, international markets have cooled off.

The drama in Cyprus doesn't help things much. With wealthy EU depositors now fearful that the haircut forced on Cypriot depositors could become the new prototype for similar crises (and there will be similar crises in the EU), banks will have to contend with a jumpy base of savers. To read a blog like Zero Hedge, the situation in Cyprus could spark the beginning of the end for the EU in 2013. Then again, to read Zero Hedge, every news headline could spark the beginning of the end for something.

While many international markets have cooled off, it looks more like a correction in most cases rather than a change in trend. Bear in mind that many overseas stock markets have been rallying extremely hard for the last year without much of a correction or consolidation along the way. That's not sustainable -- but it also doesn't mean that overseas stocks are going to zero.

More important, a handful of the strongest names are still looking very bullish indeed: the Japanese Nikkei 225 and South Korea's KOSPI are just two examples.

4. We're Near a Historic Top for Stocks

Finally, there's one of the most guttural arguments not to buy stocks in 2013: We're near a market top.

While the Dow Jones Industrial Average pushed through to new highs this year, the S&P hasn't yet and the Nasdaq Composite is still far from its high water mark. So why should stocks continue to rally when they're approaching a level where they've failed before?

Make no mistake, of course stocks could top out here. But looking back at the broad market over the last few decades, stocks have been trending higher consistently. By definition, that means that stocks were bumping their heads against all-time highs more often than not, and then pushing through them. Naturally, price resistance is a concern at an all-time high for stocks, but the technicals behind recent price action have been extremely orderly. That makes the likelihood of new highs in the S&P much higher than if the index had been on the heels of some unsustainable rally.
3 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
AAPL $93.99 0.00%
FB $102.01 0.00%
GOOG $682.40 0.00%
TSLA $151.04 0.00%
YHOO $27.04 0.00%


Chart of I:DJI
DOW 15,973.84 +313.66 2.00%
S&P 500 1,864.78 +35.70 1.95%
NASDAQ 4,337.5120 +70.6750 1.66%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs